Biopharma giants eager to cut R&D costs but still restore depleted pipelines are starting to fill the gap left by retreating VC firms, launching new funds designed to invest in promising startups. For example, the $250 million fund created by Merck & Co. last year agreed to collaborate with Flagship Ventures this April. GlaxoSmithKline and Janssen contributed $50 million each toward a €150 million ($200 million) fund whose investment decisions will be made by majority partner Index Ventures, which is investing the other half. Russia’s $10 billion state-owned technology fund Rusnano and U.S. VC firm Domain Associates committed $760 million to support U.S. pharma, diagnostics, and medical device companies, create a manufacturing plant, and increase Russian drug development.

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